NRS 686A.010Purpose.The
purpose of NRS 686A.010 to 686A.310,
inclusive, is to regulate trade practices in the business of insurance in
accordance with the intent of Congress as expressed in the Act of Congress
approved March 9, 1945, being c. 20, 59 Stat. 33, also designated as 15 U.S.C.
§§ 1011 to 1015, inclusive, and Title V of Public Law 106-102, 15 U.S.C. §§
6801 et seq.

NRS 686A.015Jurisdiction of Commissioner; Commissioner to establish program
to investigate unfair and deceptive trade practices.

1. Notwithstanding any other provision of
law, the Commissioner has exclusive jurisdiction in regulating the subject of
trade practices in the business of insurance in this state.

2. The Commissioner shall establish a
program within the Division to investigate any act or practice which
constitutes an unfair or deceptive trade practice in violation of the
provisions of NRS 686A.010 to 686A.310, inclusive.

NRS 686A.020Unfair methods and deceptive acts prohibited.A person shall not engage in this state in any
practice which is defined in NRS 686A.010 to 686A.310, inclusive, as, or determined pursuant to NRS 686A.170 to be, an unfair method of competition
or an unfair or deceptive act or practice in the business of insurance.

1. Disclosure of nonpublic personal
information in a manner contrary to the provisions of subchapter 1 of Title V
of Public Law 106-102, 15 U.S.C. §§ 6801-6809 is an unfair act or practice in
the business of insurance within the meaning of this chapter.

2. As used in this section, “nonpublic
personal information” has the meaning ascribed to it in 15 U.S.C. § 6809(4).

3. The Commissioner shall adopt
regulations necessary to carry out the provisions of this section.

1. Misrepresents the benefits, advantages,
conditions or terms of any insurance policy;

2. Misrepresents the dividends or share of
the surplus to be received on any insurance policy;

3. Makes any false or misleading statement
as to the dividends or share of surplus previously paid on any insurance
policy;

4. Is misleading or is a misrepresentation
as to the financial condition of any person, or as to the legal reserve system
upon which any life insurer operates;

5. Uses any name or title of any policy or
class of insurance policies misrepresenting the true nature thereof;

6. Is a misrepresentation for the purpose
of inducing or tending to induce the lapse, forfeiture, exchange, conversion or
surrender of any insurance policy;

7. Is a misrepresentation for the purpose
of effecting a pledge or assignment of or effecting a loan against any
insurance policy; or

8. Misrepresents any insurance policy as
being shares of stock.

(Added to NRS by 1971, 1688; A 1975, 1287)

NRS 686A.040False information and advertising prohibited.No person shall make, publish, disseminate,
circulate or place before the public, or cause, directly or indirectly, to be
made, published, disseminated, circulated or placed before the public, in a
newspaper, magazine or other publication, or in the form of a notice, circular,
pamphlet, letter or poster, or over any radio or television station, or in any
other way, any advertisement, announcement or statement containing any
assertion, representation or statement with respect to the business of
insurance or with respect to any person in the conduct of his or her insurance
business, which is untrue, deceptive or misleading.

(Added to NRS by 1971, 1688)

NRS 686A.050“Twisting” prohibited.No
person shall make or issue, or cause to be made or issued, any written or oral
statement misrepresenting or making misleading comparison as to the terms,
conditions, benefits or advantages of any insurance policy for the purpose of
inducing, or attempting or tending to induce, any other person to lapse,
forfeit, surrender, borrow against, retain, exchange, convert or otherwise deal
with or dispose of any insurance policy.

(Added to NRS by 1971, 1688)

NRS 686A.055Prohibited use of fact that insurance is covered by Nevada
Insurance Guaranty Association or Nevada Life and Health Insurance Guaranty
Association.A person who is an
insurer or an agent or employee of an insurer shall not place before the public
by any means any advertisement, announcement or statement which uses the
existence of the Nevada Insurance Guaranty Association or the Nevada Life and
Health Insurance Guaranty Association for the purpose of inducing the purchase
of, or discouraging the termination of, any insurance covered by the
Association. This section does not apply to either of the associations named.

NRS 686A.060Replacement of life insurance.In
addition to other powers of the Commissioner in respect thereto, the
Commissioner may by regulation require persons who replace or offer or propose
to replace existing life insurance with other life insurance, to leave with the
policyholder written, signed and dated statements which fully and accurately
compare the terms, conditions and benefits of the existing policy with the
proposed policy.

1. A person subject to regulation under
this Code shall not knowingly make or cause to be made any false entry of a
material fact in any book, report or statement of any person or knowingly omit
to make a true entry of any material fact pertaining to such person’s business
in any book, report or statement of such person.

2. A person shall not knowingly file with
any supervisory or other public officer, or knowingly make, publish,
disseminate, circulate or deliver to any person, or place before the public, or
knowingly cause directly or indirectly, to be made, published, disseminated,
circulated, delivered to any person, or placed before the public, any false
material statement of fact as to the financial condition of a person.

3. Any person who violates, or with like
intent, aids or abets any violation of this section is guilty of a gross
misdemeanor.

(Added to NRS by 1971, 1689; A 1975, 1287)

NRS 686A.080Defamatory statement concerning person engaged or proposing to
engage in business of insurance prohibited.No
person shall make, publish, disseminate or circulate, directly or indirectly,
or aid, abet or encourage the making, publishing, disseminating or circulating
of any oral or written statement or any pamphlet, circular, article or
literature which is false, or maliciously critical of or derogatory to an
insurer, or of an organization proposing to become an insurer, and which is
calculated to injure any person engaged or proposing to engage in the business
of insurance.

(Added to NRS by 1971, 1689)

NRS 686A.085Bank prohibited from requiring customers to purchase insurance
from parent, subsidiary or affiliate of bank.A
bank shall not in any manner extend credit, lease or sell property of any kind,
or furnish any services, or fix or vary the consideration for any of them, on
the condition or requirement that the customer purchase insurance from a
parent, subsidiary or affiliate of the bank. For the purposes of this section,
the terms “affiliate,” “parent” and “subsidiary” have the meanings ascribed to them
in NRS 683A.231.

NRS 686A.090Boycott, coercion or intimidation tending to result in
unreasonable restraint of or monopoly in business of insurance prohibited.No person shall enter into any agreement to
commit, or by any concerted action commit, any act of boycott, coercion or
intimidation resulting in or tending to result in unreasonable restraint of, or
any monopoly in, any business of insurance.

(Added to NRS by 1971, 1689)

NRS 686A.095Cancellation or restriction of agent’s authority based solely on
submission of claims prohibited.

1. An insurer shall not, without the
written consent of the agent, cancel a written agreement with an agent or
reduce or restrict the agent’s authority to transact property or casualty
insurance based solely on the loss ratio experience on insurance transacted by
that agent, if the agent was required to submit the applications for that
insurance for underwriting approval, all material information on those
applications was fully completed and the agent did not omit or alter any
information provided by the applicants for that insurance.

2. As used in this section, “loss ratio
experience” means the amount of money received by the insurer in payment of
premiums divided by the amount of money expended by the insurer in payment of
claims for a specified period.

1. No person may make or permit any unfair
discrimination between persons of the same class and equal expectation of life
in the rates charged for any contract of life insurance or of life annuity or
in the dividends or other benefits payable thereon, or in any other of the terms
and conditions of such contract.

2. No person may make or permit any unfair
discrimination between persons of the same class and of essentially the same
hazard in the amount of premium, policy fees or rates charged for any policy or
contract of health insurance or in the benefits payable thereunder, or in any
of the terms or conditions of such contract, or in any other manner whatever.

3. No person may make or permit any unfair
discrimination between persons legally qualified to provide a particular
service, in the amount of the fee or charge for that service payable as a
benefit under any policy or contract of health insurance.

1. Permit to be made or offer to make or
make any contract of life insurance, life annuity or health insurance, or
agreement as to such contract, other than as plainly expressed in the contract issued
thereon, or pay or allow, or give or offer to pay, allow or give, directly or
indirectly, or knowingly accept, as an inducement to such insurance or annuity,
any rebate of premiums payable on the contract, or any special favor or
advantage in the dividends or other benefits thereon, or any paid employment or
contract for services of any kind, or any valuable consideration or inducement
whatever not specified in the contract; or

2. Directly or indirectly give or sell or
purchase or offer or agree to give, sell, purchase, or allow as an inducement
to such insurance or annuity or in connection therewith, whether or not to be
specified in the policy or contract, any agreement of any form or nature
promising returns and profits, or any stocks, bonds or other securities, or
interest present or contingent therein or as measured thereby, of any insurer
or other corporation, association or partnership, or any dividends or profits
accrued or to accrue thereon.

(Added to NRS by 1971, 1690)

NRS 686A.120Life insurance, annuities and health insurance: Exceptions to
provisions limiting discrimination, rebates and use of securities as
inducements.

1. Nothing in NRS
686A.100 and 686A.110 shall be construed as
including within the definition of discrimination or rebates any of the
following practices:

(a) In the case of any contract of life insurance
or life annuity, paying bonuses to policyholders or otherwise abating their
premiums in whole or in part out of surplus accumulated from nonparticipating
insurance, provided that any such bonuses or abatement of premiums shall be
fair and equitable to policyholders and for the best interests of the insurer
and its policyholders.

(b) In the case of life insurance policies issued
on the debit plan, making allowance to policyholders who have continuously for
a specified period made premium payments directly to an office of the insurer
in an amount which fairly represents the saving in collection expense.

(c) Readjusting the rate of premium for a group
insurance policy based on the loss or expense experience thereunder, at the end
of the first or any subsequent policy year of insurance thereunder, which may
be made retroactive only for such policy year.

(d) Reducing the premium rate for policies of
large amounts, but not exceeding savings in issuance and administration
expenses reasonably attributable to such policies as compared with policies of
similar plan issued in smaller amounts.

(e) Reducing the premium rates for life or health
insurance policies or annuity contracts on salary savings, payroll deduction,
preauthorized check, bank draft or similar plans in amounts reasonably
commensurate with the savings made by the use of such plans.

(f) Extending credit for the payment of any
premium, and for which credit a reasonable rate of interest is charged and
collected.

2. Nothing in NRS
686A.010 to 686A.310, inclusive, shall be
construed as including within the definition of securities as inducements to
purchase insurance the selling or offering for sale, contemporaneously with
life insurance, of mutual fund shares or face amount certificates of regulated
investment companies under offerings registered with the Securities and
Exchange Commission where such shares or such face amount certificates or such
insurance may be purchased independently of and not contingent upon purchase of
the other, at the same price and upon similar terms and conditions as where
purchased independently.

1. No property, casualty, surety or title
insurer or underwritten title company or any employee or representative
thereof, and no broker, agent or solicitor may pay, allow or give, or offer to
pay, allow or give, directly or indirectly, as an inducement to insurance, or
after insurance has been effected, any rebate, discount, abatement, credit or
reduction of the premium named in a policy of insurance, or any special favor
or advantage in the dividends or other benefits to accrue thereon, or any
valuable consideration or inducement whatever, not specified or provided for in
the policy, except to the extent provided for in an applicable filing with the
Commissioner.

2. No title insurer or underwritten title
company may:

(a) Pay, directly or indirectly, to the insured
or any person acting as agent, representative, attorney or employee of the
owner, lessee, mortgagee, existing or prospective, of the real property or interest
therein which is the subject matter of title insurance or as to which a service
is to be performed, any commission, rebate or part of its fee or charges or
other consideration as inducement or compensation for the placing of any order
for a title insurance policy or for performance of any escrow or other service
by the insurer or underwritten title company with respect thereto; or

(b) Issue any policy or perform any service in
connection with which it or any agent or other person has paid or contemplates
paying any commission, rebate or inducement in violation of this section.

3. No insured named in a policy or any
employee of that insured may knowingly receive or accept, directly or
indirectly, any such rebate, discount, abatement, credit or reduction of
premium, or any such special favor or advantage or valuable consideration or
inducement.

4. No such insurer may make or permit any
unfair discrimination between insured or property having like insuring or risk
characteristics, in the premium or rates charged for insurance, or in the
dividends or other benefits payable thereon, or in any other of the terms and
conditions of insurance.

5. No casualty insurer may make or permit
any unfair discrimination between persons legally qualified to provide a
particular service, in the amount of the fee or charge for that service payable
as a benefit under any policy or contract of casualty insurance.

6. The provisions of this section do not
prohibit:

(a) The payment of commissions or other
compensation to licensed agents, brokers or solicitors.

(b) The extension of credit to an insured for the
payment of any premium and for which credit a reasonable rate of interest is
charged and collected.

(c) Any insurer from allowing or returning to its
participating policyholders, members or subscribers, dividends, savings or
unabsorbed premium deposits.

(d) With respect to title insurance, bulk rates
or special rates for customers of prescribed classes if the bulk or special
rates are provided for in the effective schedule of fees and charges of the
title insurer or underwritten title company.

7. The provisions of this section do not
apply to wet marine and transportation insurance.

2. No agent or broker violating any of
such provisions shall be entitled to receive any commission for the sale of any
policy on which any rebate or inducement prohibited by NRS
686A.110 or 686A.130 has been given or
offered, and the full amount of any commission so paid may be recovered by the
insurer so paying.

3. The amount of any insurance upon which
the insured has knowingly received or accepted, either directly or indirectly,
any unlawful rebate of the premium or agent’s, solicitor’s or broker’s
commission shall be reduced in such proportion as the amount or value of such
rebate, commission or other consideration so received by the insured bears to
the total premium on such policy.

4. A title insurer or underwritten title
company shall be liable to the State of Nevada for five times the amount of any
unlawful commission or rebate paid in violation of NRS
686A.130, which amount may be recovered by the Commissioner in addition to
any other penalty imposed by law.

(Added to NRS by 1971, 1692)

NRS 686A.150Using security, advisory board contract or agreement offering or
promising profit as inducement prohibited.Except
as provided in subsection 2 of NRS 686A.120
(contemporaneous sales of life insurance and mutual fund shares), no person
shall sell, agree or offer to sell, or give or offer to give, directly or
indirectly in any manner whatsoever, as an inducement to insurance or in
connection therewith, any stock, shares, bonds or other securities of any kind,
or any advisory board contract or other contract or agreement of any kind
offering or promising returns and profits.

(Added to NRS by 1971, 1693)

NRS 686A.160Enforcement: Prohibited practices.If
the Commissioner has cause to believe that any person has been engaged or is
engaging, in this state, in any unfair method of competition or any unfair or
deceptive act or practice prohibited by NRS 686A.010
to 686A.310, inclusive, and that a proceeding by
the Commissioner in respect thereto would be in the interest of the public, the
Commissioner may issue and serve upon such person a statement of the charges
and a notice of the hearing to be held thereon. The statement of charges and
notice of hearing shall comply with the requirements of NRS 679B.320 and shall be served upon
such person directly or by certified or registered mail, return receipt
requested.

(Added to NRS by 1971, 1693; A 1975, 1288; 1977, 432)

NRS 686A.170Enforcement: Undefined practices.

1. If the Commissioner believes that any
person engaged in the insurance business is in the conduct of such business
engaging in this state in any method of competition or in any act or practice
not defined in NRS 686A.010 to 686A.310, inclusive, which is unfair or deceptive and
that a proceeding by the Commissioner in respect thereto would be in the public
interest, the Commissioner shall, after a hearing of which notice and of the
charges against such person are given to the person, make a written report of
the findings of fact relative to such charges and serve a copy thereof upon
such person and any intervener at the hearing.

2. If such report charges a violation of NRS 686A.010 to 686A.310,
inclusive, and if such method of competition, act or practice has not been
discontinued, the Commissioner may, through the Attorney General, at any time
after 20 days after the service of such report cause an action to be instituted
in the district court of the county wherein the person resides or has his or
her principal place of business to enjoin and restrain such person from
engaging in such method, act or practice. The court shall have jurisdiction of
the proceeding and shall have power to make and enter appropriate orders in
connection therewith and to issue such writs or orders as are ancillary to its
jurisdiction or necessary in its judgment to prevent injury to the public
pendente lite; but the State of Nevada shall not be required to give security
before the issuance of any such order or injunction under this section. If a
stenographic record of the proceedings in the hearing before the Commissioner
was made, a certified transcript thereof including all evidence taken and the
report and findings shall be received in evidence in such action.

3. If the court finds that:

(a) The method of competition complained of is
unfair or deceptive;

(b) The proceedings by the Commissioner with
respect thereto are to the interest of the public; and

(c) The findings of the Commissioner are
supported by the weight of the evidence,

Ê it shall
issue its order enjoining and restraining the continuance of such method of
competition, act or practice.

4. Either party may appeal from such final
judgment or order or decree of court in a like manner as provided for appeals
in civil cases.

5. If the Commissioner’s report made under
subsection 1 or order on hearing made under NRS 679B.360 does not charge a violation
of NRS 686A.010 to 686A.310,
inclusive, then any intervener in the proceedings may appeal therefrom within
the time and in the manner provided in this Code for appeals from the
Commissioner generally.

6. Upon violation of any injunction issued
under this section, the Commissioner, after a hearing thereon, may impose the
appropriate penalties provided for in NRS 686A.187.

(Added to NRS by 1971, 1693; A 1975, 1288)

NRS 686A.180Service of process upon unauthorized insurers.

1. Service of all process, statements of
charges and notices under NRS 686A.010 to 686A.310, inclusive, upon unauthorized insurers shall
be made by delivering to and leaving with the Commissioner or some person in
apparent charge of the office of the Commissioner two copies thereof, or in the
manner provided for by subsection 2 of NRS
685B.050 (service of process).

2. The Commissioner shall forward all such
process, statements of charges and notices to the insurer in the manner
provided in subsection 3 of NRS 685B.050.

3. No default shall be taken against any
such unauthorized insurer until expiration of 30 days after the date of
forwarding by the Commissioner under subsection 2, or date of service of
process if under subsection 2 of NRS
685B.050.

4. NRS
685B.050 applies to all process, statements of charges and notices under
this section.

1. After the hearing provided for in NRS 686A.160, the Commissioner shall issue an order
on hearing pursuant to NRS 679B.360.
If the Commissioner determines that the person charged has engaged in an unfair
method of competition or an unfair or deceptive act or practice in violation of
NRS 686A.010 to 686A.310,
inclusive, the Commissioner shall order the person to cease and desist from
engaging in that method of competition, act or practice, and may order one or
both of the following:

(a) If the person knew or reasonably should have
known that he or she was in violation of NRS 686A.010
to 686A.310, inclusive, payment of an
administrative fine of not more than $5,000 for each act or violation, except
that as to licensed agents, brokers, solicitors and adjusters, the
administrative fine must not exceed $500 for each act or violation.

(b) Suspension or revocation of the person’s
license if the person knew or reasonably should have known that he or she was
in violation of NRS 686A.010 to 686A.310, inclusive.

2. Until the expiration of the time
allowed for taking an appeal, pursuant to NRS
679B.370, if no petition for review has been filed within that time, or, if
a petition for review has been filed within that time, until the official
record in the proceeding has been filed with the court, the Commissioner may,
at any time, upon such notice and in such manner as the Commissioner deems proper,
modify or set aside, in whole or in part, any order issued by him or her under
this section.

3. After the expiration of the time
allowed for taking an appeal, if no petition for review has been filed, the
Commissioner may at any time, after notice and opportunity for hearing, reopen
and alter, modify or set aside, in whole or in part, any order issued by him or
her under this section whenever in the opinion of the Commissioner conditions
of fact or of law have so changed as to require such action or if the public
interest so requires.

(a) Upon the expiration of the time allowed for
taking an appeal, if no petition for review has been duly filed within such
time, except that the Commissioner may thereafter modify or set aside the order
to the extent provided in subsection 3 of NRS 686A.183;
or

(b) Upon the final decision of the court if the
court directs that the order of the Commissioner be affirmed or the petition for
review dismissed.

(Added to NRS by 1975, 1285)

NRS 686A.187Penalties for violating cease and desist order.Any person who violates a cease and desist
order of the Commissioner issued under NRS 686A.183,
except one issued with respect to NRS 686A.170, is
subject, in the discretion of the Commissioner, after notice and hearing and
upon order of the Commissioner, to one or both of the following:

1. Payment of an administrative fine of
not more than $5,000 for each and every violation.

2. Suspension or revocation of the
license.

(Added to NRS by 1975, 1285)

NRS 686A.190Interlocking ownership or management.

1. Any insurer may retain, invest in or
acquire the whole or any part of the capital stock of any other insurer or
insurers, or have a common management with any other insurer or insurers,
unless such retention, investment, acquisition or common management is
inconsistent with any other provision of this Code, or unless by reason thereof
the business of such insurers with the public is conducted in a manner which
substantially lessens competition generally in the insurance business or tends
to create any monopoly therein.

2. Any person otherwise qualified may be a
director of two or more insurers which are competitors, unless the effect
thereof is to lessen substantially competition between insurers generally or
tends materially to create any monopoly.

(Added to NRS by 1971, 1694)

NRS 686A.200Favored agent or insurer.

1. Except as otherwise provided in NRS 616B.710, no person shall require,
directly or indirectly, or through any trustee, director, officer, agent or
employee or affiliate, as a condition, agreement or understanding to selling or
furnishing any other person any loan, or extension thereof, credit, sale,
goods, property, contract, lease or service, that such other person shall
place, continue (other than as to life insurance) or renew any policy of
insurance of any kind through any particular agent, broker or insurer. No
agent, broker or insurer shall knowingly participate in any such prohibited
plan or transaction. No person shall fix a price charged for such thing or
service, or discount from or rebate upon price, on the condition, agreement or
understanding that any insurance is to be obtained through a particular agent,
broker or insurer.

2. Subsection 1 does not prevent:

(a) The exercise by any such person upon a
reasonable basis of any right to approve or disapprove of the insurer and
representative to underwrite the insurance. Such basis shall relate only to the
adequacy and terms of the coverage with respect to the interest of the vendor,
lender, lessor or provider of service to be insured thereunder, the financial
standards to be met by the insurer, and the ability of the insurer or
representative to service the policy.

(b) The exercise by the vendor, lender, lessor or
provider of service of the right to furnish or renew the insurance, and to
charge the account of the other person with the costs thereof, if such other
person fails to deliver such insurance to the lender, vendor, lessor or
provider of service, where otherwise called for and in order, at least 15 days
prior to expiration of the existing policy.

NRS 686A.210Service and processing charges prohibited.No mortgagee, lessor, vendor or other person
whose interest is insured under an insurance policy paid for by another shall
make, receive or accept any monetary charge or fee paid or payable by such other
person, for handling, servicing or processing the insurance policy, or
endorsements thereon or cancellation thereof.

(Added to NRS by 1971, 1696)

NRS 686A.220Favored agent or surety for bonds under public building or
construction contract.

1. Except as otherwise provided in NRS 616B.710, no officer or employee of
this state, or of any public agency, public authority or public corporation
(except a public corporation or public authority created pursuant to agreement
or compact with another state), and no person acting or purporting to act on
behalf of such officer or employee, or public agency or public authority or
public corporation, shall, with respect to any public building or construction
contract which is about to be or which has been competitively bid, require the
bidder to make application or furnish financial data to, or to obtain or
procure any of the surety bonds or contracts of insurance specified in
connection with such contracts or by any law from, a particular insurer or
agent or broker.

2. Except as otherwise provided in NRS 616B.710, no such officer or
employee or any person acting or purporting to act on behalf of such officer or
employee shall negotiate, make application for, obtain or procure any of such
surety bonds or contracts of insurance (except contracts of insurance for
builder’s risk or owner’s protective liability) which can be obtained or
procured by the bidder, contractor or subcontractor.

3. This section does not, however, prevent
the exercise by such officer or employee on behalf of the State or such public
agency, public authority or public corporation of its right to approve the
form, sufficiency or manner of execution of the surety bonds or contracts of
insurance furnished by the insurer selected by the bidder to underwrite such
bonds or contracts of insurance.

4. Any provisions in any invitation for
bids or in any of the contract documents in conflict with this section are
declared to be contrary to the public policy of this state.

5. A violation of this section is subject
to the penalties provided by NRS 679A.180
(general penalty).

NRS 686A.230Illegal dealing in premiums; excess charges for insurance;
regulations related to fees of broker, consultant or financial planner; written
contract for consultation.

1. A person shall not willfully collect
any sum as a premium or charge for insurance which is not then provided or is
not in due course to be provided, subject to acceptance of the risk by the
insurer, by an insurance policy issued by an insurer as authorized by this
Code.

2. Except as otherwise provided in
subsection 3, a person shall not willfully collect as a premium or charge for
insurance any sum in excess of the premium or charge applicable to the
insurance and as specified in the policy, in accordance with the applicable
classifications and rates as filed with and approved by the Commissioner. In
cases where classifications, premiums or rates are not required by this Code to
be so filed and approved, the premiums and charges must not be in excess of
those specified in the policy and as fixed by the insurer. This subsection does
not prohibit:

(a) The charging and collection by surplus lines
brokers licensed under chapter 685A of NRS
of the amount permitted by chapter 685A of
NRS and regulations adopted by the Commissioner.

(b) The charging and collection by a life insurer
of amounts actually to be expended for the medical examination of any applicant
for life insurance or for reinstatement of a life insurance policy.

3. The Commissioner may adopt regulations
to allow the charging and collection of a fee by an insurance broker,
consultant or financial planner:

(a) In lieu of any other charge or commission for
solicitation, negotiation or procurement of a policy of insurance which covers
commercial or business risks;

(b) For consultation or any related advice on the
insuring of commercial or business risks which does not result in the
procurement of a policy of insurance; and

(c) For consultation or related advice on the
purchase of life or health insurance or an annuity, whether or not it results
in the purchase of a policy of insurance or annuity. In such a case, the fee
must be set forth in a written contract signed by the client before the
consultation begins.

4. An agent or broker who provides
consultation or related advice pursuant to this section shall do so pursuant to
a written contract specifying the compensation the agent or broker will
receive. The compensation may be in addition to or in lieu of a commission and
is not a premium as defined in NRS
679A.115.

1. No form or plan of insurance covering
any group or combination of persons or risks shall be written or delivered
within or outside this state to cover persons or risks in this state at any
preferred rate or on any form other than as offered to persons not in such
group or combination and to the public generally, unless such form, plan of
insurance, and the rates or premiums to be charged therefor have been submitted
to and approved by the Commissioner.

2. Any such plan of insurance described in
subsection 1 shall not be approved by the Commissioner unless it is made
available to all individuals of the group who seek to be insured. No insurer or
agent shall deny coverage to any individual of such group who seeks the type of
insurance which is being made available to other members of the group.

3. This section does not apply to life
insurance, health insurance, annuity contracts or wet marine and transportation
insurance.

(Added to NRS by 1971, 1942)

NRS 686A.250Use of insurance or annuity as inducement for purchase or rental
of property or services prohibited; exceptions.

1. No person shall arrange, provide or
participate in any plan to offer or effect any kind or kinds of insurance or
annuities in this state as an inducement to the purchase or rental by the
public of any property or services, without a separate charge to the insured
for such insurance.

2. This section does not apply to:

(a) Insurance written in connection with a
subscription to newspapers of general circulation;

(b) Insurance issued to credit unions or members
thereof in connection with the purchase of shares in such credit union;

(c) Insurance offered as guarantee to the
performance of goods and designed to protect the purchasers or users of such
goods;

(d) Title insurance;

(e) Life or health insurance written in
connection with an indebtedness for the purpose of paying the balance of the
indebtedness on death or disability of the individual insured; or

(f) Services provided by motor clubs.

(Added to NRS by 1971, 1696)

NRS 686A.260Revocation or suspension of license for violation of laws of
other state.The Commissioner may
revoke or suspend the license of any person domiciled or resident in Nevada and
licensed to transact insurance in Nevada as insurer, agent, broker or
otherwise, upon a hearing and proof that such person, as the result of a
hearing before the commissioner, director or superintendent of insurance or
insurance department of another state, or in a judicial proceeding in another
state, has been found to have violated the insurance laws of that state
relating to unfair methods of competition or unfair or deceptive acts or
practices in the conduct of the business of insurance, and as a result thereof
either has had his or her license revoked or suspended in that state or has
been found guilty of failing to comply with any order, decree or judgment
issued pursuant to such hearing or judicial proceeding in that state.

(Added to NRS by 1971, 1697)

NRS 686A.270Knowledge of insurer of prohibited acts.No insurer shall be held guilty of having
committed any of the acts prohibited by NRS 686A.010
to 686A.310, inclusive, by reason of the act of
any agent, solicitor or employee not an officer, director or department head
thereof, unless an officer, director or department head of the insurer has
knowingly permitted such act or has had prior knowledge thereof.

(Added to NRS by 1971, 1697)

NRS 686A.280Use of name deceptively implying person is insurer prohibited.No person who is not an insurer shall assume
or use any name which deceptively implies or suggests that it is an insurer.

1. Presenting or causing to be presented
any statement to an insurer, a reinsurer, a producer, a broker or any agent
thereof, if the person who presents or causes the presentation of the statement
knows that the statement conceals or omits facts, or contains false or
misleading information concerning any fact material to an application for the
issuance of a policy of insurance pursuant to this title.

2. Presenting or causing to be presented
any statement as a part of, or in support of, a claim for payment or other
benefits under a policy of insurance issued pursuant to this title, if the
person who presents or causes the presentation of the statement knows that the
statement conceals or omits facts, or contains false or misleading information
concerning any fact material to that claim.

3. Assisting, abetting, soliciting or
conspiring with another person to present or cause to be presented any
statement to an insurer, a reinsurer, a producer, a broker or any agent
thereof, if the person who assists, abets, solicits or conspires knows that the
statement conceals or omits facts, or contains false or misleading information
concerning any fact material to an application for the issuance of a policy of
insurance pursuant to this title or a claim for payment or other benefits under
such a policy.

4. Acting or failing to act with the
intent of defrauding or deceiving an insurer, a reinsurer, a producer, a broker
or any agent thereof, to obtain a policy of insurance pursuant to this title or
any proceeds or other benefits under such a policy.

5. As a practitioner, an insurer or any
agent thereof, acting to assist, conspire with or urge another person to commit
any act or omission specified in this section through deceit, misrepresentation
or other fraudulent means.

6. Accepting any proceeds or other
benefits under a policy of insurance issued pursuant to this title, if the
person who accepts the proceeds or other benefits knows that the proceeds or
other benefits are derived from any act or omission specified in this section.

7. Employing a person to procure clients,
patients or other persons who obtain services or benefits under a policy of
insurance issued pursuant to this title for the purpose of engaging in any act
or omission specified in this section, except that such insurance fraud does not
include contact or communication by an insurer or an agent or representative of
the insurer with a client, patient or other person if the contact or
communication is made for a lawful purpose, including, without limitation,
communication by an insurer with a holder of a policy of insurance issued by
the insurer or with a claimant concerning the settlement of any claims against
the policy.

8. Participating in, aiding, abetting,
conspiring to commit, soliciting another person to commit, or permitting an employee
or agent to commit any act or omission specified in this section.

1. A physician, dentist, nurse, dispensing
optician, optometrist, physical therapist, podiatric physician, psychologist,
chiropractor, doctor of Oriental medicine in any form, director or technician
of a medical laboratory, pharmacist or other provider of health services who is
authorized to engage in his or her occupation by the laws of this state or
another state; and

2. An attorney admitted to practice law in
this state or any other state.

NRS 686A.283Reporting requirements; duties of Commissioner and Attorney
General; prosecution by district attorney.

1. Any person, governmental entity,
insurer or authorized representative of an insurer shall report any information
concerning insurance fraud to the Commissioner and Attorney General on a form
prescribed by the Commissioner and Attorney General.

2. The Commissioner and Attorney General
shall each independently:

(a) Review each report of insurance fraud; and

(b) Determine whether an investigation should be
made of the facts in the report.

3. During their respective investigations,
the Commissioner and Attorney General shall independently determine whether
there is probable cause to believe that insurance fraud has occurred.

4. A district attorney of any county where
fraudulent activity has occurred or is occurring or where a fraudulent claim
that would constitute insurance fraud has been made may, with the permission of
the Attorney General or at the request of the Attorney General, institute proceedings
in the name of the State of Nevada.

NRS 686A.285Report by insurer of suspicion that loss to insured was caused
by other than accidental or natural occurrence.

1. If an insurer has a reasonable
suspicion that a loss to an insured may have been caused by other than an
accidental or a natural occurrence, the insurer shall notify the Commissioner
and Attorney General in writing of the insurer’s reasons for the suspicion.

2. Any insurer making such a report shall
provide the Commissioner and Attorney General with any information the insurer
obtained during its investigation of the claim.

3. If the loss referred to in subsection 1
is believed to be caused by fire, the insurer shall also so notify an
investigative or law enforcement agency.

1. Every insurer shall provide information
concerning insurance fraud to the Attorney General, the Commissioner, any
investigative or law enforcement agency or any agency of the Federal
Government, if the insurer receives a request in writing for that information.

2. The information requested from an
insurer may include:

(a) Information about the policy of insurance on
the property which was demolished or destroyed, including information from the
application for insurance;

(b) Information on previous claims made by the
insured;

(c) Records of the premiums paid for the policy
of insurance; and

(d) Information concerning the insurer’s
investigation of the claim, including statements of any person, information
submitted as proof of the loss or any other relevant information on the claim.

NRS 686A.289Provision to insurer of information concerning fraud upon
completion of investigation or prosecution; confidentiality of information.

1. Any insurer giving information to the
Attorney General, the Commissioner or any investigative or law enforcement
agency concerning an act or omission alleged to be insurance fraud is entitled
to receive, upon completion of the investigation or prosecution of the
insurance fraud, whichever occurs later, any relevant information concerning
the fraudulent activity.

2. The Attorney General, the Commissioner
or any investigative or law enforcement agency receiving information from
another person, agency or insurer shall:

(a) Keep the information confidential and not
release the information except pursuant to subsection 1 and NRS 239.0115;

(b) Provide information concerning its
investigation of the insurance fraud to the insurer reporting the fraudulent
activity upon the completion of its investigation or a criminal prosecution,
whichever occurs later; and

(c) Provide any documents necessary or allow its
employees or agents to testify in any action by or against the insurer if the
insurer or its insured furnished the information for the investigation or a
criminal prosecution.

1. An agent, broker, solicitor, examining
physician, applicant or other person shall not knowingly or willfully make any
false or fraudulent statement or representation in or with reference to any
application for insurance.

2. A person who violates this section is
guilty of a category D felony and shall be punished as provided in NRS 193.130. In addition to any other penalty,
the court shall order the person to pay restitution.

NRS 686A.292Additional penalties for insurance fraud; payment of expenses of
Fraud Control Unit; persons who are victims for purposes of restitution.

1. A court may, in addition to imposing
the penalties set forth in NRS 193.130,
order a person who is convicted of, or who pleads guilty, guilty but mentally
ill or nolo contendere to, insurance fraud to pay:

(a) Court costs; and

(b) The cost of the investigation and prosecution
of the insurance fraud for which the person was convicted or to which the
person pleaded guilty, guilty but mentally ill or nolo contendere.

2. Any money received by the Attorney
General pursuant to paragraph (b) of subsection 1 must be accounted for
separately and used to pay the expenses of the Fraud Control Unit for Insurance
established pursuant to NRS 228.412,
and is hereby authorized for expenditure for that purpose. The money in the
account does not revert to the State General Fund at the end of any fiscal year
and must be carried forward to the next fiscal year.

3. An insurer or other organization, or
any other person, subject to the jurisdiction of the Commissioner pursuant to
this title shall be deemed to be a victim for the purposes of restitution in a
case that involves insurance fraud or that is related to a claim of insurance
fraud.

NRS 686A.295Commissioner and Attorney General to notify agency when person
licensed by or registered with agency is convicted of insurance fraud.If a person who is licensed or registered
under the laws of the State of Nevada to engage in a business or profession is
convicted of, or pleads guilty or guilty but mentally ill to, engaging in an
act of insurance fraud, the Commissioner and the Attorney General shall forward
to each agency by which the convicted person is licensed or registered a copy
of the conviction or plea and all supporting evidence of the act of insurance
fraud.

NRS 686A.300Delay in payment of claim for damages to motor vehicle after
receipt of statement of charges prohibited; settling claim without providing
for repair of vehicle permitted; exception.

1. An insurer who issues insurance
covering damage to a motor vehicle shall not delay making payment for any claim
involving damage to a motor vehicle after receiving a statement of charges,
pursuant to the provisions of NRS 487.6893,
from any garage or licensed body shop previously authorized by the insured to
perform the repairs required by that claim.

2. A delay, within the meaning of this
section, is failure to issue a check or draft, payable to the garage or
licensed body shop or jointly to the insured and the garage or licensed body
shop, within 30 days after the insurer’s receipt of the statement of charges
for repairs which have been satisfactorily completed.

3. If the damaged vehicle is subject to a
security interest or the legal owner of the damaged vehicle is different from
the registered owner, the vehicle must be repaired by a garage or licensed body
shop unless:

(a) The insurer has declared the vehicle a total
loss; or

(b) The total charge for the repair of the
vehicle, as set forth in the statement of charges presented pursuant to NRS 487.6893, is $300 or less.

4. Except as otherwise provided in
subsection 3, nothing in this section shall be deemed to prohibit an insurer
and insured from settling a claim involving damage to a motor vehicle without
providing for the repair of the vehicle.

5. As used in this section, “licensed body
shop” means a body shop for which a license has been issued pursuant to chapter 487 of NRS.

1. Engaging in any of the following
activities is considered to be an unfair practice:

(a) Misrepresenting to insureds or claimants
pertinent facts or insurance policy provisions relating to any coverage at
issue.

(b) Failing to acknowledge and act reasonably
promptly upon communications with respect to claims arising under insurance
policies.

(c) Failing to adopt and implement reasonable
standards for the prompt investigation and processing of claims arising under
insurance policies.

(d) Failing to affirm or deny coverage of claims
within a reasonable time after proof of loss requirements have been completed and
submitted by the insured.

(e) Failing to effectuate prompt, fair and
equitable settlements of claims in which liability of the insurer has become
reasonably clear.

(f) Compelling insureds to institute litigation
to recover amounts due under an insurance policy by offering substantially less
than the amounts ultimately recovered in actions brought by such insureds, when
the insureds have made claims for amounts reasonably similar to the amounts
ultimately recovered.

(g) Attempting to settle a claim by an insured
for less than the amount to which a reasonable person would have believed he or
she was entitled by reference to written or printed advertising material
accompanying or made part of an application.

(h) Attempting to settle claims on the basis of
an application which was altered without notice to, or knowledge or consent of,
the insured, or the representative, agent or broker of the insured.

(i) Failing, upon payment of a claim, to inform
insureds or beneficiaries of the coverage under which payment is made.

(j) Making known to insureds or claimants a
practice of the insurer of appealing from arbitration awards in favor of
insureds or claimants for the purpose of compelling them to accept settlements
or compromises less than the amount awarded in arbitration.

(k) Delaying the investigation or payment of
claims by requiring an insured or a claimant, or the physician of either, to
submit a preliminary claim report, and then requiring the subsequent submission
of formal proof of loss forms, both of which submissions contain substantially
the same information.

(l) Failing to settle claims promptly, where
liability has become reasonably clear, under one portion of the insurance
policy coverage in order to influence settlements under other portions of the
insurance policy coverage.

(n) Failing to provide promptly to an insured a
reasonable explanation of the basis in the insurance policy, with respect to
the facts of the insured’s claim and the applicable law, for the denial of the
claim or for an offer to settle or compromise the claim.

(o) Advising an insured or claimant not to seek
legal counsel.

(p) Misleading an insured or claimant concerning
any applicable statute of limitations.

2. In addition to any rights or remedies
available to the Commissioner, an insurer is liable to its insured for any
damages sustained by the insured as a result of the commission of any act set
forth in subsection 1 as an unfair practice.

1. If a hospital submits to an insurer the
form prescribed by the Director of the Department of Health and Human Services
pursuant to NRS 449.485, that form must
contain or be accompanied by a statement that reads substantially as follows:

Any person who misrepresents
or falsifies essential information requested on this form may, upon conviction,
be subject to a fine and imprisonment under state or federal law, or both.

2. If a person who is licensed to practice
one of the health professions regulated by title 54 of NRS submits to an
insurer the form commonly referred to as the “HCFA-1500” for a patient who is
not covered by any governmental program which offers insurance coverage for
health care, the form must be accompanied by a statement that reads
substantially as follows:

Any person who knowingly
files a statement of claim containing any misrepresentation or any false,
incomplete or misleading information may be guilty of a criminal act punishable
under state or federal law, or both, and may be subject to civil penalties.

3. The failure to provide any of the
statements required by this section is not a defense in a prosecution for
insurance fraud pursuant to NRS 686A.291.

1. In any third-party liability claim, an
insurer shall not issue a check or draft or otherwise make payment of $5,000 or
more in settlement of the claim to a representative of the claimant, including,
without limitation, the lawyer for the claimant, unless the insurer, at the
time of making the payment or as soon as practicable thereafter, mails written
notice of the payment to the claimant at the last known address of the
claimant.

2. The failure of an insurer to serve
notice as required by subsection 1 or defective service of the notice does not:

(a) Create, and must not be construed to create,
a cause of action for any natural person or entity other than the Commissioner.

(b) Establish, and must not be construed to
establish, a defense for any party to any cause of action.

3. As used in this section, “third-party
liability claim” means a claim brought under a liability insurance policy by a
person other than the insured, where the claimant is a natural person.

1. “Agreement” means a contract between a
person and an insured or prospective insured under which the person agrees to
pay a premium in advance on behalf of the insured or prospective insured in
exchange for repayment of the amount advanced with interest or for some other
consideration.

2. “Company” means a person engaged in the
business of entering into agreements or purchasing agreements. The term does
not include a person who finances a premium in connection with the sale of a
motor vehicle upon which the person holds a lien.

NRS 686A.340Engaging in business of company without license prohibited.Except as provided in NRS
686A.350, a person shall not engage in the business of a company or hold
himself or herself out as a company without first having received a license
from the Commissioner to engage in the business of a company.

NRS 686A.370True name and fictitious name of licensee; grounds for disapproval
of name.

1. An unincorporated licensee or
unincorporated applicant for a license who desires the issuance of a license
under a fictitious name must file with the Commissioner a certified copy of the
entry in the county clerk’s register and of the certificate or any renewal
certificate filed pursuant to chapter 602 of
NRS. An incorporated licensee and incorporated applicant must file with the
Commissioner in writing the corporation’s true name and the fictitious names
under which it conducts or intends to conduct business in this state. After
licensing, each licensee shall file promptly with the Commissioner written
notice of any change in or discontinuance of any fictitious name.

2. The Commissioner may in writing
disapprove the use of any true name, other than the bona fide natural name of a
natural person, or any fictitious name used or proposed to be used by any
applicant or licensee, on any of the following grounds:

(a) The name interferes with or is deceptively
similar to a name already filed and in use by another licensee;

(b) Use of the name may mislead the public in any
respect; or

(c) The name states or implies that the licensee
or applicant is an insurer or is entitled to engage in insurance activities not
authorized under the licenses which the licensee holds or for which the
applicant has applied.

1. A company must renew its license on or
before March 1 of each year. An application for renewal must be submitted on a
form prescribed by the Commissioner and must be accompanied by:

(a) A financial statement for the preceding year;
and

(b) A fee of $500, any penalty imposed pursuant
to subsection 2 and, in addition to any other fee or charge, all applicable
fees required pursuant to NRS 680C.110.

2. The Commissioner may grant an extension
allowing a company to file an application for renewal after March 1 if the
company shows that for reasons beyond its control it cannot apply before that
date. If a company which has not been granted an extension files its
application for renewal after March 1, the company shall pay a penalty of $25
for each day the application is late.

NRS 686A.385Schedule of rates and charges to be filed with Commissioner.

1. A company shall, immediately after it
has been issued a license, file with the Commissioner a schedule of rates and
charges it intends to use in this state. The schedule must include, and
separately identify, any commission which is required to be paid to an agent or
broker who completes an agreement. Any change in the schedule must be filed
with the Commissioner at least 60 days before the rates become effective.

2. A company may not impose a charge
included in an agreement unless the charge is included in the schedule filed with
the Commissioner.

3. The Commissioner shall not approve any
charge listed in the schedule which is unfairly discriminatory in relation to
similar risks.

1. Before using a form for an agreement or
notice required by this chapter, a company must submit the proposed form to the
Commissioner for approval. If the Commissioner does not disapprove a form
within 60 days after it is submitted, the form shall be deemed approved.

2. The Commissioner shall not approve any
form unless it complies with the provisions of NRS
686A.330 to 686A.520, inclusive.

3. An insurer, including any subsidiary of
an insurer or corporation under substantially the same management or control as
an insurer, shall file all forms for agreements and any related forms. The
filing required in this subsection is in addition to the filings required
pursuant to chapter 686B of NRS.

NRS 686A.400Records: Maintenance; form of preservation; open to
Commissioner.

1. A company shall maintain records of
each transaction for 3 years after making the final entry with respect to the
transaction. The records may be preserved in photographic form, on microfilm or
microfiche or in a form approved by the Commissioner.

2. The records must be open to the
Commissioner at all times. The Commissioner may require a company to furnish to
the Commissioner in any form the Commissioner requires any information
maintained in the company’s records.

NRS 686A.410Examination of company by Commissioner.The
Commissioner may conduct an examination of a company at any time in accordance
with NRS 679B.250 to 679B.287, inclusive. The expense of the
examination must be borne by the company in accordance with NRS 679B.290 as if the company were an
insurer.

1. An agreement executed in this state
must be dated and signed by the insured. The printed portion of the agreement
must be in not less than 8-point type. The agreement must include:

(a) The name and the address and telephone number
of the business of the insurance agent for the insurance contract to which the
agreement relates;

(b) The name and the address of the business or
residence of the insured;

(c) The name, address and telephone number of the
company to which payments must be made;

(d) A brief description of any insurance policy
involved; and

(e) Such other information as may be required by
the Commissioner.

2. An agreement must have at its top in type
which is more prominent than the text of the agreement, the words “Agreement
For Financing Premium” or words of similar meaning. An agreement must contain a
notice in type which is more prominent than the text of the agreement which
reads as follows:

Notice:

1. Do not sign
this agreement before you have read it or if it contains any blank spaces.

NRS 686A.430Furnishing of completed copy of agreement to insured.The agent, broker or other person preparing an
agreement shall furnish a completed copy of the agreement to the insured
immediately after the insured signs the agreement.

1. A company shall not charge or collect a
charge for interest which is not permitted by this section.

2. Interest must be computed on the
balance due, after subtracting the down payment, from the effective date of the
insurance contract or agreement, whichever is earlier, through the date on
which the final installment is payable.

3. The rate of interest must be specified
in the agreement. The agreement may provide for a service charge of not more
than $25, and that the charge is not refundable.

4. An insured may prepay in full at any
time the unpaid balance of the principal. The insured is entitled to a refund
of the unearned portion of the prepaid interest. The refund must be at least as
great a proportion of the prepaid interest as the sum of the periodic balances
for each period beginning one period after the prepayment is made bears to the
sum of all the periodic balances under the schedule of payments in the
agreement. If the amount of the refund is less than $1, no refund need be made.

5. Any provision which purports to limit
the insured’s right of prepayment pursuant to this section is void.

1. A company shall not impose or collect a
fee or charge which is not authorized by this section.

2. An agreement may provide for a charge
for any late payment of an installment of not less than $1 and not more than 5
percent of the installment.

3. A company may collect a fee of not more
than $15 for each check returned to the company because the insured had
insufficient money or credit with the drawee to pay the check or because the
insured stopped payment on the check.

4. An agreement may provide for payment of
collection costs or attorney’s fees, equal to 20 percent of the outstanding
indebtedness if the agreement is referred for collection to a collection agency
or attorney who is not an employee of the company.

1. When an agreement contains a power of
attorney enabling the company, in the name of the insured, to cancel any
insurance policy listed in the agreement, the insurance policy must not be
cancelled by the company unless it is cancelled in accordance with this
section.

2. A company shall mail written notice of
its intent to cancel an insurance policy because of a default in payment under
an agreement to the insured at the last known address of the insured as
indicated in the records of the company and to the agent who submitted the
agreement at least 10 days before the cancellation. If the default is cured
within this 10-day period, the company shall not cancel the insurance policy.

3. If the default is not cured within the
10-day period, the company may cancel the policy if it mails to the insured at
the last known address of the insured as indicated in the records of the
company and to the insurer a notice of cancellation which must include the
effective date of cancellation. The policy must be cancelled as if the notice
of cancellation had been submitted by the insured, but without requiring the
return of the policy.

4. No insurance policy may be cancelled
for nonpayment of a charge for a late payment.

5. This section does not authorize the
cancellation of an insurance policy without giving any other notice required by
law or satisfying other conditions for cancellation.

6. A company shall not impose or collect a
fee for the cancellation of a policy or agreement.

1. When an insurance policy is cancelled
pursuant to NRS 686A.460, the insurer shall return
the unearned premium to the company for credit to the account of the insured.
The premium must be mailed to the company:

(a) Within 45 days after receipt of the notice of
cancellation; or

(b) Immediately following an audit performed to
determine the amount of the premium. If such an audit is performed, it must be
completed within 60 days after receipt of the notice of cancellation.

2. If the returned portion of the premium
exceeds the insured’s obligation to the company, the company shall pay the
excess to the insured within 30 days after receipt, except that no refund is required
if the excess is less than $1.

3. If the returned portion of the premium
is less than the insured’s obligation to the company, the company shall notify
the insured within 15 days making a demand for payment, except that the company
shall not make a demand for payment if the obligation is less than $1.

4. The company shall notify the agent who
submitted the agreement of any refund paid directly to the insured pursuant to
subsection 2 at the time the refund is paid. Within 15 days after receipt of
this notice, the agent shall refund to the insured any unearned commissions
which are owed to the insured as a result of the cancellation.

5. The company shall notify the agent who
submitted the agreement of any deficiency. Within 30 days after receipt of the
notice, the agent shall refund to the insured any unearned commissions which
are owed to the insured as a result of the cancellation.

1. No agreement may contain a provision
allowing a company recourse against the agent who submitted the agreement based
upon the insured’s default in payments.

2. A company, broker or an agent of a
company shall not offer to any person as an inducement to enter an agreement
any gift, rebate or other consideration unless the consideration is an article
of less than $2 in value which includes an advertisement of the company. This
subsection does not prohibit a company from providing to a broker or an agent
who submits the agreement to the company any supplies or equipment necessary to
submit the agreement to the company. Any such supplies or equipment which is
not disposable remains the property of the company.

3. A company or an agent or broker
submitting an agreement shall not:

(a) Induce or attempt to induce an insured to
become obligated under more than one agreement to obtain more than one initial
charge for entering the agreement.

(b) Write any insurance in connection with the
agreement, including life or health insurance limited to the amount advanced on
behalf of the insured.

NRS 686A.500Disclosure of financial interest required; agent or broker who
submits or performs services in connection with agreement prohibited from
receiving compensation.

1. Any licensed resident or nonresident
agent or broker who has any financial interest in a company, other than in
submitting agreements through the company, shall disclose to the insured, in
the manner prescribed by the Commissioner, his or her interest in the company.

2. A licensed resident or nonresident
agent or broker who submits any agreement shall not accept any compensation for
arranging, directing or performing services in connection with the agreement. A
company shall not pay or offer to pay any compensation to a licensed resident
or nonresident agent or broker who submits an agreement to the company.

1. A person who violates the provisions of
NRS 686A.340 shall be punished by a fine of not
more than $200 per day or $500 per agreement per day for every day the
violation continues, whichever is greater.

2. A person who violates any other
provision of NRS 686A.330 to 686A.520, inclusive, shall be punished by a fine of
not more than $1,000.

3. A person who fails or refuses to comply
with an order issued by the Commissioner pursuant to NRS
686A.330 to 686A.520, inclusive, shall be
punished by a fine of not more than $1,000.

NRS 686A.600Definitions.As
used in NRS 686A.600 to 686A.730,
inclusive, unless the context otherwise requires, the words and terms defined
in NRS 686A.610 to 686A.660,
inclusive, have the meanings ascribed to them in those sections.

NRS 686A.610“Adverse action” defined.“Adverse
action” means a denial or cancellation of, an increase in any charge for, or a
reduction or other adverse or unfavorable change in the terms of coverage or
amount of, any insurance, existing or applied for, in connection with any policy.

NRS 686A.630“Consumer credit report” defined.“Consumer
credit report” means any written, oral or other communication of information by
a consumer reporting agency bearing on the credit worthiness, credit standing
or credit capacity of an applicant or policyholder, and which is used or
expected to be used or collected in whole or in part for the purpose of serving
as a factor to determine:

NRS 686A.640“Consumer reporting agency” defined.“Consumer
reporting agency” means any person which, for monetary fees, dues or on a
cooperative nonprofit basis, regularly engages in whole or in part in the
practice of assembling or evaluating consumer credit information or other
information on consumers for the purpose of furnishing consumer credit reports
to third parties.

NRS 686A.650“Credit information” defined.“Credit
information” means any information that is related to credit and derived from a
consumer credit report, found on a consumer credit report or provided on an
application for a policy. The term does not include information that is not
related to credit, regardless of whether it is contained in a consumer credit
report or in an application for a policy, or is used to calculate an insurance
score.

NRS 686A.660“Insurance score” defined.“Insurance
score” means a number or rating that is derived from an algorithm, computer
application, model or other process that is based in whole or in part on credit
information for the purposes of predicting the future losses or exposure with
regard to an applicant or policyholder.

NRS 686A.670Applicability.The
provisions of NRS 686A.600 to 686A.730, inclusive, do not apply to a contract of
surety insurance issued pursuant to chapter
691B of NRS or any commercial or business policy.

1. Use an insurance score that is
calculated using income, gender, address, zip code, ethnic group, religion,
marital status or nationality of the consumer as a factor, or would otherwise
lead to unfair or invidious discrimination.

2. Deny, cancel or fail to renew a policy
on the basis of credit information unless the insurer also considers other
applicable underwriting factors that are independent of credit information and
not expressly prohibited by this section.

3. Base renewal rates for a policy upon
credit information unless the insurer also considers other applicable factors
independent of credit information.

4. Take an adverse action against an
applicant or policyholder based on the applicant or policyholder not having a
credit card account unless the insurer also considers other applicable factors
independent of credit information.

5. Consider an absence of credit
information or an inability to calculate an insurance score in underwriting or
rating a policy unless the insurer does any one of the following:

(a) Treats the applicant or policyholder as
otherwise approved by the Commissioner, after the insurer presents to the
Commissioner information indicating that such an absence or inability relates
to the risk for the insurer.

(b) Treats the applicant or policyholder as if
the applicant or policyholder had neutral credit information, as defined by the
insurer.

(c) Excludes the use of credit information as a
factor, and uses only underwriting criteria other than credit information.

6. Take an adverse action against an
applicant or policyholder based on credit information, unless an insurer
obtains and uses a consumer credit report issued or an insurance score
calculated within 90 days from the date the policy is first written or renewal
is issued.

7. Except as otherwise provided in this
subsection, use credit information regarding a policyholder without obtaining
an updated consumer credit report regarding the policyholder and recalculating
the insurance score at least once every 36 months. At the time of the annual
renewal of a policyholder’s policy, the insurer shall, upon the request of the
policyholder or the policyholder’s agent, reunderwrite and rerate the policy
based upon a current consumer credit report or insurance score. An insurer need
not, at the request of a policyholder or the policyholder’s agent, recalculate
the insurance score of or obtain an updated consumer credit report of the
policyholder more frequently than once in any 12-month period. An insurer may,
at its discretion, obtain an updated consumer credit report regarding a
policyholder more frequently than once every 36 months, if to do so is
consistent with the underwriting guidelines of the insurer. An insurer does not
need to obtain an updated consumer credit report for a policyholder if any one
of the following applies:

(a) The insurer is treating the policyholder as
otherwise approved by the Commissioner.

(b) The policyholder is in the most
favorably-priced tier of the insurer and all affiliates of the insurer. With
respect to such a policyholder, the insurer may elect to obtain an updated
consumer credit report if to do so is consistent with the underwriting
guidelines of the insurer.

(c) Credit information was not used for
underwriting or rating the policyholder when the policy was initially written.
The fact that credit information was not used initially does not preclude an
insurer from using such information subsequently when underwriting or rating
such a policyholder upon renewal, if to do so is consistent with the
underwriting guidelines of the insurer.

(d) The insurer reevaluates the policyholder at
least once every 36 months based upon underwriting or rating factors other than
credit information.

8. Use the following as a negative factor
in any insurance scoring methodology or in reviewing credit information for the
purpose of underwriting or rating a policy:

(a) Credit inquiries not initiated by the
applicant or policyholder, or inquiries requested by the applicant or
policyholder for his or her own credit information.

(b) Inquiries relating to insurance coverage, if
so identified on the consumer credit report.

(c) Collection accounts relating to medical
treatment, if so identified on the consumer credit report.

(d) Multiple lender inquiries, if identified on
the consumer credit report as being related to home loans or mortgages and made
within 30 days of one another, unless only one inquiry is considered.

(e) Multiple lender inquiries, if identified on
the consumer credit report as being related to a loan for an automobile and
made within 30 days of one another, unless only one inquiry is considered.

1. Notwithstanding any other law or regulation,
an insurer that uses credit information shall, upon receipt of a written
request from an applicant or policyholder, provide reasonable exceptions to the
insurer’s rates, rating classifications, company or tier placement, or
underwriting rules or guidelines for an applicant or policyholder who has
experienced and whose credit information has been directly influenced by any of
the following:

(a) A catastrophic event, as declared by the
Federal or State Government;

(b) A serious illness or injury, or a serious
illness or injury to an immediate family member;

(c) The death of a spouse, child or parent;

(d) Divorce or involuntary interruption of
legally-owed alimony or support payments;

(e) Identify theft;

(f) Temporary loss of employment for a period of
3 months or more, if it results from involuntary termination;

(g) Military deployment overseas; or

(h) Other events, as determined by the insurer.

2. If an applicant or policyholder submits
a request for an exception as set forth in subsection 1, an insurer may, in its
sole discretion:

(a) Require the applicant or policyholder to
provide reasonable written and independently verifiable documentation of the
event;

(b) Require the applicant or policyholder to
demonstrate that the event had direct and meaningful impact on the credit
information of the applicant or policyholder;

(c) Require that such a request be made not more
than 60 days after the date of the application for insurance or the policy
renewal;

(d) Grant an exception despite the applicant or
policyholder not providing the initial request for an exception in writing; or

(e) Grant an exception where the applicant or
policyholder asks for consideration of repeated events or the insurer has
considered this event previously.

3. An insurer is not out of compliance
with any law or rule relating to underwriting, rating or rate filing as a
result of granting an exception under this section. Nothing in this section
shall be construed to provide an applicant or policyholder with a cause of action
that does not exist in the absence of this section.

4. The insurer shall provide notice to
each applicant and policyholder that reasonable exceptions are available and
include information about how the applicant or policyholder may inquire further
about such exceptions.

5. Within 30 days after the insurer’s
receipt of sufficient documentation of an event described in subsection 1, the
insurer shall inform the applicant or policyholder of the outcome of the
request for a reasonable exception. Such communication must be in writing or
provided to the applicant or policyholder in the same medium as the request.

6. The Commissioner may adopt regulations
to carry out the provisions of this section.

NRS 686A.690Reunderwriting or rerating of insured; refund of premium.If it is determined pursuant to the dispute
resolution process set forth in section 611(a) of the federal Fair Credit
Reporting Act, 15 U.S.C. § 1681i(a), that the credit information of a
policyholder was incorrect or incomplete and if the insurer receives notice of
such determination from either the consumer reporting agency or from the
policyholder, the insurer shall reunderwrite and rerate the policyholder within
30 days of receiving the notice. After reunderwriting or rerating the insured,
the insurer shall make any adjustments necessary, consistent with its
underwriting and rating guidelines. If an insurer determines that the
policyholder has overpaid a premium, the insurer shall refund to the
policyholder the amount of overpayment calculated back to the shorter of either
the last 12 months of coverage or the actual period of the policy.

1. If an insurer uses credit information
in underwriting or rating an applicant, the insurer or its agent shall
disclose, either on the application for the policy or at the time the
application is taken, that the insurer may obtain credit information in
connection with the application. The disclosure must be written or provided to
an applicant in the same medium as the application. The insurer need not
provide the disclosure required pursuant to this subsection to a policyholder
upon renewal of a policy if the policyholder was previously provided the
disclosure in connection with the policy. An insurer may comply with the
requirements of this subsection by providing the following statement:

In connection with this application
for insurance, we may review your credit report or obtain or use a credit-based
insurance score based on the information contained in that credit report. We
may use a third party in connection with the development of your insurance
score.

2. The Division shall post on its Internet
website a list of each insurer that does not use an insurance score when
underwriting, rating an applicant for or calculating the premium for a policy
of insurance for a passenger car or homeowner’s insurance and shall update this
list on July 1 of each year.

3. The Division may post on its Internet
website, without limitation:

(a) General information concerning the use of an
insurance score in underwriting, rating an applicant for or calculating the
premium for a policy of insurance; and

(b) Applicable laws governing the manner in which
an insurance score may be used.

4. As used in this section, “passenger
car” has the meaning ascribed to it in NRS
482.087.

NRS 686A.710Notice requirements after taking adverse action.If an insurer takes an adverse action based
upon credit information, the insurer shall:

1. Provide notice to the applicant or
policyholder that an adverse action has been taken, in accordance with the
requirements of section 615(a) of the federal Fair Credit Reporting Act, 15
U.S.C. § 1681m(a).

2. Provide notice to the applicant or
policyholder explaining the reasons for the adverse action. The reasons must be
provided in sufficiently clear and specific language so that a person can
identify the basis for the insurer’s decision to take the adverse action. The
notice must include a description of not more than four factors that were the
primary influences of the adverse action. The use of generalized terms such as
“poor credit history,” “poor credit rating” or “poor insurance score” does not
meet the requirements of this subsection. The notice required by this
subsection must be provided in a form approved by the Commissioner.

1. An insurer shall indemnify, defend and
hold harmless an agent of the insurer from and against all liability, fees and
costs arising out of or relating to the actions, errors or omissions of the
agent with regard to obtaining or using credit information or insurance scores
for the insurer, if the agent follows the instructions of or procedures
established by the insurer and complies with any applicable law or regulation.

2. This section does not provide, expand,
limit or prohibit any cause of action an applicant or policyholder may have
against an agent of an insurer.

1. A consumer reporting agency shall not
provide or sell data or lists that include any information that in whole or in
part was submitted in conjunction with:

(a) An inquiry by or for an insurer about the
credit information of an applicant or policyholder; or

(b) A request for a credit report or insurance
score.

2. The information described in subsection
1 includes, without limitation:

(a) The expiration date of a policy or any other
information that may identify time periods during which a policy of an
applicant or policyholder may expire; and

(b) The terms and conditions of the coverage
provided by a policy of an applicant or policyholder.

3. The restriction set forth in subsection
1 does not apply to data or lists the consumer reporting agency supplies to the
insurer, or an agent or affiliate of the insurer, from whom the information was
received.

4. The provisions of this section do not
restrict any insurer from being able to obtain a report regarding a motor
vehicle or a report of a history of claims.